Ontario civil | Bankruptcy and Insolvency | Practice and procedure in courts | Stay of proceedings
Applicants were indirect wholly owned subsidiaries of U.S. Debtor, P LLC. Both P Inc. and P GP were governed by Canada Business Corporations Act (“CBCA”). P LP was limited partnership organized under laws of Ontario. General partner and limited partner of P LP were P GP and P Inc., respectively. P LP was primary vehicle conducting business operations of P Entities. P Inc. brought application for relief under Companies’ Creditors Arrangement Act (“CCAA”), including initial stay of proceedings. Applicants also sought to have stay of proceedings and other benefits of Initial Order extended to P LP, together with applicants, P Entities, limited partnership which carried on substantially all of operations of P Entities. Applicants also applied for P Entities to require stay of proceedings in order to prevent enforcement actions by various creditors including landlords and other contractual counterparties. Application allowed. It was appropriate to grant requested stay of proceedings. It was appropriate that stay of proceedings apply not only in respect of applicants’ themselves, but that it extended to partnership P LP. Although definition of debtor company in the CCAA did not include partnerships, court had previously held that where limited partnership was significantly interrelated to business of applicants and formed integral part of its operations, CCAA Court may extend stay of proceedings accordingly.
Payless ShoeSource Canada Inc. and Payless ShoeSource Canada GP Inc. (Re) (2019), 2019 CarswellOnt 3056, 2019 ONSC 1215, G.B. Morawetz R.S.J. (Ont. S.C.J. [Commercial List]).
